Stock investors are the most bullish they've been in 15 years, one measure shows
- One stock market indicator shows investors haven't been this bullish in at least 15 years, according to Goldman Sachs.
- Short interest in the S&P 500 has fallen to its lowest level since at least 2005, as the stock market hits record highs despite underlying weakness in the economy due to COVID-19.
- While short interest is low across the board in the stock market, there is one sector that investors remain confident in betting against: energy.
- Visit Business Insider's homepage for more stories.
Based on one indicator, investors haven't been this bullish on the stock market in at least 15 years.
In a note published on Thursday, Goldman Sachs highlighted that short interest in the S&P 500 has fallen to its lowest level in at least 15 years of its 16-year data history.
The decline in short interest comes as stocks cruise to record highs after recovering from the fastest bear market on record.
Hedge funds, which often sell short to either hedge their long positions or because they have a bearish view on a stock or index, "focused on their long portfolios and reduced their short exposures" amid the stock market's strongest 100-day rally on record, according to Goldman Sachs.
The median stock within the S&P 500 had outstanding short interest equating to just 1.8% of its market cap, Goldman said.
But there is one sector investors continue to bet against: energy. According to the note, energy was the only sector in the S&P 500 that had outstanding short interest above its 15-year average (2.9% versus the average 2.8%).
And one stock that could have made investors think twice about shorting is Tesla. Short-sellers have lost as much as $25 billion shorting Tesla stock year-to-date, according to S3 Partners.